Virus derived from an infectious molecular clone of ELI was found to be infectious in PBMC, was found to exhibit a delayed time course of infection on CEM and H9 cells, but was unable to infect U937 cells. The virus that arose from the H9 cells was able to infect CEM and H9 cells without any delay in replication kinetics. In addition, this passaged virus was able to infect U937 cells. Two regions in the envelope gene were found to have mutations, and these changes were shown to confer the enhanced replicative capacity and expanded host range characteristics of the passaged virus. A Val-7 substitution in gp41 conferred the ability to replicate in T cell lines, while the additional Arg-427 change in gp120 was required before the virus could replicate in the promonocytic U937 cell line. The effect of these mutations on several parameters of envelope structure has been investigated. We have determined that the Met-7 to Val substitution in gp41 does not have a significant effect on spontaneous gp120 shedding although it increases the affinity of virions for CD4-IgG and amount of the CD4-induced dissociation of gp120 from virions. With both the gp41 Val-7 and the gp120 Arg-427 substitutions, the affinity of the virions for CD4-IgG, the spontaneous gp120 release, and the CD4-induced gp120 shedding are increased further. Thus, there is a correlation with the ability of a virus to replicate in cell lines and the tendency of its envelope to release gp120 after association with CD4. Mutations were constructed in the nef genes of several strains of HIV-1 and HIV-2 in order to ascertain the effect of Nef on virus replication in vitro. The effect of Nef on virus replication was more variable when tested on various CD4-positive cell lines. In some cases, there was no detectable difference in the replication kinetics between the Nef mutant and wild type viruses. These results demonstrate that the effects of Nef are variable and depend on the particular host-virus system, and that Nef is usually a positive factor for the replication of HIV in vitro.